Honda, GM Adapt Plans as EV Demand Slows, Trade Risks Rise

Honda and General Motors have announced significant shifts in their global strategies, reflecting slow down in demand for electric vehicles (EVs) and growing trade-related uncertainties in the automotive sector.

On Tuesday, Honda lowered its electrification investment target from US$69 billion to US$48 billion through 2031, citing weakening US demand and regulatory uncertainty as primary factors.

“The environment surrounding the automobile industry is changing day by day,” Honda stated. “Uncertainty in the business environment is increasing, particularly due to the slowdown in the expansion of the EV market, driven by factors such as changes in environmental regulations.”

Honda CEO Toshihiro Mibe described the adjustment as “a switch in the planned course” but reaffirmed the company’s commitment to its long-term electrification goals.

On Monday, General Motors announced it would cease exporting Chevrolet Tahoe SUVs to China and cancel plans to expand exports of other high-end models under its Durant Guild program.

“Due to significant changes in economic conditions, we have decided to restructure the Durant Guild and correspondingly optimize GM China’s operations,” GM said. The Durant Guild initiative accounted for less than 0.1% of GM’s 2024 sales volume in China.

EV adoption is slowing. Installations of high-speed chargers fell by over 21% in 1Q25, while automakers have scaled back EV investments. Nissan recently scrapped plans to build a US$1.1 billion battery factory on Japan’s Kyushu island, just months after announcing the project. Similarly, Jaguar Land Rover has postponed plans to produce electric vehicles at parent company Tata Motors’ upcoming US$1 billion facility in southern India, according to Reuters.